1
Exhibit 99a
CONDENSED STATEMENT OF INCOME THE DEXTER CORPORATION
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In thousands of dollars Three Months Ended September 30 Nine Months Ended September 30
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(except per share amounts) 1996 1995 Change 1996 1995 Change
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REVENUES
Net sales $ 269,493 $ 268,467 $ 832,421 $ 818,251 + 2%
Other income 3,182 2,272 +40% 8,379 8,210 + 2%
--------- --------- --------- ---------
272,675 270,739 +1% 840,800 826,461 + 2%
EXPENSES
Cost of sales 176,997 183,910 - 4% 547,278 558,139 - 2%
Marketing and administrative 54,755 51,950 + 5% 167,149 154,087 + 8%
Research and development 12,470 11,931 + 5% 38,488 37,286 + 3%
Interest 4,929 5,203 - 5% 15,671 15,562 + 1%
Gain on divestiture of product lines (2,719)
--------- --------- --------- ---------
INCOME BEFORE TAXES 23,524 17,745 +33% 74,933 61,387 +22%
Income taxes 8,351 6,081 +37% 26,601 21,792 +22%
--------- --------- --------- ---------
INCOME BEFORE MINORITY INTERESTS 15,173 11,664 +30% 48,332 39,595 +22%
Minority interests 3,432 2,265 +52% 11,050 7,776 +42%
--------- --------- --------- ---------
NET INCOME $ 11,741 $ 9,399 +25% $ 37,282 $ 31,819 +17%
========= ========= ========= =========
NET INCOME PER SHARE $ 0.50 $ 0.39 +28% $ 1.57 $ 1.31 +20%
DIVIDENDS DECLARED PER SHARE $ 0.22 $ 0.22 $ 0.66 $ 0.66
AVERAGE SHARES OUTSTANDING (000) 23,545 24,377 - 3% 23,733 24,369 - 3%
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See accompanying notes to the consolidated financial statements.
2
EXHIBIT 99b
THE DEXTER CORPORATION
CONDENSED STATEMENT OF FINANCIAL POSITION
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In thousands of dollars SEPTEMBER 30 December 31 September 30
(except per share amounts) ------------------------------------------------
1996 1995 1995
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ASSETS
Cash and short-term securities $ 82,356 $ 65,542 $ 61,551
Accounts receivable, net 200,546 201,389 206,793
Inventories
Materials and supplies 57,085 60,099 61,722
In process and finished 107,177 121,644 120,456
LIFO reserve (21,231) (24,709) (24,669)
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143,031 157,034 157,509
Prepaid and deferred expenses 31,882 32,756 29,955
--------- --------- ---------
Total current assets 457,815 456,721 455,808
Property, plant and equipment, at cost, net 321,912 325,203 324,751
Excess of cost over net assets of
businesses acquired 74,805 74,102 74,841
Other assets 83,575 78,135 78,525
--------- --------- ---------
$ 938,107 $ 934,161 $ 933,925
========= ========= =========
LIABILITIES & SHAREHOLDERS' EQUITY
Short-term debt $ 5,501 $ 13,598 $ 8,917
Current installments of long-term debt 12,649 13,648 9,298
Accounts payable 81,568 92,447 86,992
Accrued liabilities and taxes 104,089 81,659 90,203
Current environmental reserves 1,207 1,395 1,654
Dividends payable 5,183 5,351 5,363
--------- --------- ---------
Total current liabilities 210,197 208,098 202,427
Long-term debt 208,839 215,839 224,017
Deferred items 48,316 48,492 48,261
Long-term environmental reserves 15,219 15,745 15,798
Minority interests 85,759 76,372 73,186
Shareholders' equity
Common stock and paid-in capital 34,768 35,116 34,635
Retained earnings 369,212 347,544 344,136
Currency translation effects (3,185) 1,614 1,263
Treasury stock (31,018) (14,659) (9,798)
--------- --------- ---------
Total shareholders' equity 369,777 369,615 370,236
--------- --------- ---------
$ 938,107 $ 934,161 $ 933,925
========= ========= =========
EQUITY PER SHARE $ 15.69 $ 15.26 $ 15.19
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See accompanying notes to the consolidated financial statements.
3
EXHIBIT 99c
THE DEXTER CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
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Nine Months Ended September 30
--------------------------------
In thousands of dollars 1996 1995
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OPERATIONS
Net income $ 37,282 $ 31,819
Noncash items
Depreciation and amortization 33,537 33,123
Gain on divestiture of product lines (2,719)
Income taxes not due 10,839 3,594
Minority interests 11,050 7,776
LIFO inventory (credit) charge (3,478) 1,841
Equity in net income of affiliates (3,196) (1,541)
Other 3,658 (1,230)
Operating working capital increase (2,886) (39,507)
-------- --------
84,087 35,875
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INVESTMENTS
Property, plant and equipment (38,455) (21,199)
Acquisitions (16,198) (424)
Divestitures 34,913
Joint ventures 4,047 (2,942)
Notes receivable 200 3,150
Proceeds from exercise of LTI stock options 1,736 2,299
Other (4,053) 1,329
-------- --------
(17,810) (17,787)
-------- --------
FINANCING
Long-term debt (6,576) (656)
Short-term debt, net (8,035) 4,116
Dividends paid (15,782) (16,078)
LTI dividends paid to minority interest shareholders (1,133) (1,026)
Purchase of treasury stock (21,434)
Other 3,718 (178)
-------- --------
(49,242) (13,822)
-------- --------
INCREASE IN CASH AND SHORT-TERM SECURITIES $ 17,035 $ 4,266
======== ========
RECONCILIATION OF INCREASE IN
CASH AND SHORT-TERM SECURITIES
Cash and short-term securities at beginning of period $ 65,542 $ 55,012
Cash and short-term securities at end of period 82,356 61,551
-------- --------
Increase in cash and short-term securities
per Statement of Financial Position 16,814 6,539
Currency translation effects 221 (139)
Cash included from consolidation of a subsidiary
which became majority-owned in 1995 (2,134)
-------- --------
$ 17,035 $ 4,266
======== ========
INTEREST PAID $ 16,338 $ 12,568
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TAXES PAID $ 15,762 $ 18,198
======== ========
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See accompanying notes to the consolidated financial statements.
4
EXHIBIT 99d
NET SALES BY MARKET THE DEXTER CORPORATION
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Three Months Ended September 30 Nine Months Ended September 30
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In thousands of dollars 1996 1995 Change 1996 1995 Change
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AEROSPACE $ 13,102 $ 10,776 +22% $ 37,635 $ 34,083 +10%
ELECTRONICS 47,136 47,905 - 2% 144,614 141,084 + 3%
FOOD PACKAGING (1) 68,276 69,898 - 2% 205,781 214,722 - 4%
MEDICAL (2) 102,111 90,516 +13% 303,396 272,104 +12%
OTHER (3) (4) 38,868 49,372 -21% 140,995 156,258 -10%
-------- -------- ---------- ---------
CONSOLIDATED $269,493 $268,467 $ 832,421 $818,251 + 2%
======== ======== ========== =========
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(1) The effect of businesses acquired increased net sales to the Food
Packaging market by $0.7 million, or 1%, for the quarter, and $1.4
million, or 1%, year-to-date.
(2) The effect of businesses acquired increased net sales to the Medical
market by $2.0 million, or 2%, for the quarter, and $9.5 million, or
3%, year-to-date.
(3) The effect of businesses divested decreased net sales in the "Other"
category by $10.8 million, or 22%, for the quarter, and $17.3 million,
or 11%, year-to-date.
(4) Sales previously classified in the Automotive market are now included
in the "Other" category.
5
Exhibit 99e
The Dexter Corporation
Notes to Consolidated Financial Statements
Note 1 - In the opinion of company's management, the unaudited financial
statements reflect adjustments of a normal recurring nature which
are necessary to present a fair statement of the results for the
interim periods. The notes to the consolidated financial
statements including management's discussion in Part 1, Item 2 of
this Form 10-Q are incorporated as part of these consolidated
financial statements. The year-end condensed balance sheet data
was derived from audited financial statements.
Note 2 - Net income per share figures in the consolidated Condensed
Statement of Income are based on the weighted average number of
shares outstanding as indicated for each period. No effect has
been given to stock options or restricted stock awards
outstanding as no dilutive effect would result from the inclusion
of these items.
Note 3 - The following are included as components of Common Stock and
Paid-in Capital.
COMMON STOCK & PAID-IN CAPITAL SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
(IN THOUSANDS OF DOLLARS) 1996 1995 1995
- ------------------------------ ------------- ------------ -------------
Common stock $24,984 $24,984 $24,984
Paid-in capital 13,938 12,316 12,443
Unrealized losses on
investments (350) (128) (247)
Unearned compensation on
restricted stock (3,331) (1,583) (2,545)
Pension liability adjustment (473) (473)
--------- --------- ---------
$34,768 $35,116 $34,635
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6
REPORT OF INDEPENDENT ACCOUNTANTS
To the Shareholders and Board of Directors of
The Dexter Corporation
We have reviewed the accompanying condensed statement of financial position of
The Dexter Corporation as of September 30, 1996 and 1995, and the related
condensed statement of income for the three and nine month periods ended
September 30, 1996 and 1995, and the condensed statement of cash flows for the
nine month periods then ended. These financial statements are the responsibility
of the company's management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated statement of financial position of The Dexter
Corporation as of December 31, 1995, and the related consolidated statements of
income, cash flows, and changes in shareholders' equity for the year then ended
(not presented herein); and in our report dated February 1, 1996, we expressed
an unqualified opinion on those consolidated financial statements. In our
opinion, the information set forth in the accompanying condensed statement of
financial position as of December 31, 1995, is fairly stated, in all material
respects, in relation to the consolidated statement of financial position from
which it has been derived.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Springfield, Massachusetts
October 10, 1996